Border trade rules to be tightened
Tran Quoc Toan, Deputy Director-General of the Import-Export Department, Ministry of Industry of Trade, talks on Vietnam’s decision to gradually eliminate all temporary import and re-export activities through Vietnam-China sub-border gates.
Workers wear masks as they unload goods from containers at Ma Lu Thang border gate in the northern mountainous province of Son La.
Will you please explain Vietnam’s decision to eliminate all temporary import and re-export activities through unofficial sub-border gates along the Vietnam-China border?
All temporary import-export activities across the border including consignment of goods from overseas into bonded warehouses are considered internationally as normal business activities. However, in Vietnam, these activities cause quite a lot of risks as Vietnamese law has allowed temporary import-export activities to take place in all sub-border gates and even in unofficial cross border gates with neighbouring countries.
Such unofficial cross border import-export activities can cause many risks, including to diplomatic relations between Vietnam and its neighbouring countries. Furthermore, it has negatively impacted on relations between Vietnam and its neighbours and the volume of goods going through official border gates.
Do you mean that in the near future such unofficial cross border activities will be banned?
Recently, all countries sharing borders with Vietnam have tightened border controls. Such activities have hampered Vietnamese unofficial cross border activities. They have caused big losses to Vietnamese enterprises due to the tax incurred in goods storage and many other expenses and they still cannot export their goods to China.
At the request of the People’s Committee from the northern border province of Quang Ninh, the Ministry of Trade organised a meeting with participants coming from concerned ministries and sectors, and together, the participants drafted a document on the cessation of temporarily imported-exported activities through Vietnamese unofficial border gates or international border gates.
With the Prime Minister’s approval, the Ministry of Industry and Trade then quickly developed Circular No.09/2020 and posted it on its website.
What will be the negative impacts of Circular No.09/2020 when it comes into force?
For the immediate future, the circular may have negative impacts on enterprises which are doing businesses in temporary import-export activities. However, I don’t think the negative impacts will be too big as recently quite a few neighbouring countries have already tightened cross border trade through their sub-border gates, including unofficial border gates. In the long run, all temporary import-export activities will only be done through international border gates. This policy will create a legal corridor for enterprises to pursue stable, sustainable and efficient business. Adding to that it will also help Vietnamese enterprises cut risks when their goods have to go through sub-border gates, including unofficial cross border gates with neighbouring countries.
To help reduce losses for Vietnamese enterprises, the Ministry of Industry and Trade has developed a roadmap which will come into force from January 1, 2021, so that all the enterprises will have time to prepare and develop business plans to make them in line with requirements on temporary import-export activities to go through these border gates.
Has the MOIT developed a plan on the halt of border trade activities?
Basically speaking, Chinese policies on tightening the imports of farm products and fisheries are in line with the international norms and practices. That’s why most of the countries in the region and elsewhere have worked closely with China or they have developed their own regulations or instructions to help enterprises to comply with what is regulated by China.
For Vietnam, the Ministry of Industry and Trade has many times given warnings, recommendations and instructions to export enterprises and localities to closely follow China’s rules on cross-border trade policies. The MOIT has also recommended Vietnamese enterprises switch to official trade instead of cross border trade. VNS/PLTPHCM
Border guard forces and agencies in cities and provinces are strictly monitoring travel through border gates to prevent the spread of COVID-19.
As online commerce has boomed, agencies fear that it will be difficult to prevent banned goods, goods restricted for import and export, and origin fraud.